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The choice between traditional Medicare and Medicare Advantage? It’s easier than you think.
Ask yourself these questions before you enroll in a Medicare Advantage plan.
Diane Archer knows more about traditional Medicare and private Medicare Advantage plans than just about anyone I know. She founded the Medicare Rights Center in 1989 and now publishes Just Care, a resource for boomers, older adults, and care providers. She also serves on the board of directors of the Center for Health & Democracy. Diane will be a regular contributor to HEALTHCARE un-covered.
- Wendell Potter
Make no mistake. Traditional Medicare, which is government-administered, and Medicare Advantage, which is administered by corporate insurers, are fundamentally different. But it’s easy to think otherwise, as they both offer Medicare benefits.
Can you see the doctors you need to see wherever you happen to be in the U.S.?
Only traditional Medicare covers your care from virtually any doctor or hospital in the U.S. Medicare Advantage plans generally only cover care from a restricted network of doctors and hospitals, often only in your community. When they cover care from health-care providers outside of their network, you are often left paying 40% of the bill out of pocket.
Will you be covered for all the Medicare services your physicians say you need?
Only traditional Medicare covers these services. Medicare Advantage plans often second-guess your treating physicians, and too often inappropriately delay and deny you needed care, even though they are supposed to cover the same medically necessary services as traditional Medicare.
Will you face administrative obstacles to care, such as referrals by primary-care providers and prior authorization requirements for specialty care?
Only traditional Medicare allows you to go straight to the physicians and hospitals you want to use without creating barriers. Medicare Advantage plans too often require you to get their permission to get the treatments you need, at times second-guessing your physicians. They cover significantly fewer services than traditional Medicare.
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Will your Medicare plan profit from delaying and denying care?
Only traditional Medicare gives your health-care providers an incentive to provide all the care you need. Medicare Advantage plans receive a fixed amount from the government to cover your care, regardless of how much they spend on it. The less money a Medicare Advantage plan spends on your care, the more money the Medicare Advantage plan has for its shareholders. They profit from delaying and denying care.
Can you limit your out-of-pocket health care costs?
Only traditional Medicare provides you with the option of buying supplemental insurance to fill gaps in coverage. But traditional Medicare does not have an out-of-pocket limit, so if you don’t have Medicaid, which fills gaps in coverage, or supplemental insurance — which can easily cost $2,500 a year — your out-of-pocket costs could be substantial. Medicare Advantage has an out-of-pocket limit. But that limit can be as high as $8,300 a year for in-network care alone in 2023, depending upon the plan you choose.
How will you get prescription drug benefits?
You can buy a Medicare Part D prescription drug benefit if you’re in traditional Medicare for about $30 a month. If you’re in Medicare Advantage, prescription drug benefits are generally included. Either way, Medicare only covers some of the costs of your drugs. You need to check to see whether the plan you choose will cover the drugs you need at a reasonable cost to you.
Do you want “extra” benefits?
This is a trick question. Traditional Medicare does not cover vision, hearing and dental care, or transportation services and gym memberships. Medicare Advantage often tacks on one or more of these benefits to its package to lure enrollees. If these are important to you, make sure they are meaningful benefits. Medicare Advantage plans often force you to use a small group of providers for these services as well as to pay substantial amounts out of pocket for them.
Want to know which Medicare Advantage plan is best for you?
Throw a dart and say a prayer. Many Medicare Advantage plans have long histories of engaging in consumer fraud. A lot of them have been found to inappropriately delay and deny people needed care. Many do not have cancer centers of excellence in their networks and, if they do, the networks frequently change. The government is not able to assess meaningful quality differences among them; the five-star rating system is largely meaningless.
Can you save money by joining a Medicare Advantage plan?
Yes. You can save on the cost of supplemental insurance and Part D prescription drug coverage. But if you develop a serious condition and need expensive care, you will likely pay a lot more for your care in a Medicare Advantage plan than you would in traditional Medicare.
Can you enroll in a Medicare Advantage plan while you’re healthy, then switch to traditional Medicare when you need costly care?
Theoretically you can. But in practice, you take a big financial and health risk. Unless you live in Maine, Massachusetts, New York or Connecticut, companies offering Medicare supplemental insurance are not required to sell you coverage to fill gaps in traditional Medicare after you are first eligible for Medicare, except in limited situations. If you can’t buy supplemental coverage, you are effectively locked into Medicare Advantage to protect yourself financially, because traditional Medicare has no out-of-pocket cap.
Bottom line: If you can afford supplemental coverage in traditional Medicare or have Medicaid, you and your family can sleep well, knowing you will be able to get the care you need, wherever you are in the U.S., whenever you need it, without worry about out-of-pocket costs. Don’t count on that in Medicare Advantage.